OMAHA, Neb. — Billionaire Warren Buffett doesn’t want to give up the throne at his holding company anytime soon, but the 76-year-old is preparing for that day.

Many details remain secret, But the question of who might become Berkshire Hathaway Inc.’s chief investment officer is getting the most attention because Buffett said in March he plans to hire one or more candidates for that position soon on a trial basis.

Wrapping up this weekend’s activities surrounding Berkshire Hathaway’s shareholders meeting, Buffett said whoever he hires should expect to be paid based on how well their investments perform.

“I would give them a small salary, and then pay them a percentage based on how they outperformed the S&P on a five-year average,” Buffett said at a news conference Sunday.

Vice Chairman Charlie Munger said that fits with the company’s overall compensation plan.
“Generally, we want people’s compensation tied to what they can control,” Munger said. So he said Berkshire’s new investment managers won’t be paid based on Berkshire’s overall value.

When he returns to the office Monday, Buffett will encounter the 600 to 700 applications he’s already received for that post, and the mail will likely bring more.

Buffett said the investment managers he hires won’t necessarily be expected to live in Omaha where he and the company’s 19-person headquarters are based.

“My notion would be to let them live wherever they feel best about life,” Buffett said. “Wherever you can think best, the information is readily available.”

Of the three of four investment managers Buffett plans to hire, he has said one, or maybe two, would eventually become Berkshire’s chief investment officer.

That’s one of the three jobs Buffett is dividing his duties into as part of his succession plan.

The only part that has been spelled out is the job of chairman. Buffett has said that when he dies, his son Howard will take over the job to ensure Berkshire’s culture is preserved. The younger Buffett already serves on the board.

Buffett said he has already picked three managers of companies Berkshire Hathaway Inc. owns who could succeed him as chief executive tomorrow, if the need arose.

“All three of them would be, in many respects, better at it than I am,” Buffett said Sunday. “But they don’t own 30 percent of the stock, so they’ll have to wait.”

But Buffett said again Sunday that he still loves what he does and is in good health.

“I feel terrific. You ought to try this peanut brittle,” Buffett said, referring to the box of candy he and Munger kept between them at the news conference.

Despite the central role Munger plays in the company, little attention is paid to finding a successor for the 83-year-old vice chairman. But he says that’s how it should be.
“I do not need to be replaced,” Munger said. “If you fade away, you do not need to be replaced.”

Berkshire owns more than 60 companies including insurance, clothing, furniture, jewelry and candy companies, restaurants, natural gas and corporate jet firms and has major investments in such companies as Coca-Cola Co., Anheuser-Busch Cos. and Wells Fargo & Co.

Before the annual Berkshire meeting Saturday, Buffett grabbed his ukulele and joined the Quebe Sisters Band for a performance in the Qwest Center exhibition hall where some of Berkshire's more than 60 companies showcased their products to 27,000 visitors.

As he sat down on a stool between three fiddle players he joked: "I may well be looking for another job soon. This is my first audition."

At the meeting, shareholders overwhelmingly rejected a proposal that would have prohibited Berkshire from investing in foreign companies that engage in activities that U.S. corporations must avoid because of presidential executive orders.

Specifically, the proposal would have required the holding company to sell its 2.3 billion shares of PetroChina, which does business in Sudan. The U.S. has said Sudan uses its oil wealth to wage genocide against the people in the Darfur region.